I charged a Unicorn which was protected by an adjacent Illusionary Pegasus. My attack registered a kill on the Unicorn which popped the Pegasus Illusion. The Unicorn survived, but the registered hit still triggered Draugar. Draugar only works upon killing Living Units, but must be coded to trigger on registered hits rather than where the death effect occurs.

Is the above event intended? The event seems to contradict either Sacrifice or Draugar.

I think the game should only ever trigger Draugar/Leech if the (real, living) victim dies.
So even if a real pegasus sacrificed itself, the Draugar should not have triggered.
Sacrifice and Fountain of Life bend my poor head:D

Good catch. I love that anomalies like this are still being discovered, it shows just how many variations there are in the actions and events which can occur during a single turn when wizard special abilities and creature special abilities combine.. even the game is still learning all the different permutations.. It's testament to the game's depth.